Newsletter – 14th July 2017

Morning Bulletin

Yesterday

  • Sterling performed strongly yesterday gaining ground on both the euro and US dollar.
  • GBP/EUR rallied by just under half of a percent on the day closing at 1.1349 following an opening rate of 1.1294.
  • Dollar weakness remained following comments made by Fed Chair Janet Yellen on Wednesday and this saw GBP/USD gain 0.4% on Thursday. Cable closed at the top end of its recent range at 1.2937 after opening at 1.2884.
  • The Repeal Bill was published yesterday and came under scrutiny from opposition parties. This piece of legislation, formerly known as the European Union (Withdrawal) Bill seeks to transpose EU law in the UK statute book.
  • The bill is meant to provide certainty for business and individuals at the point that Britain leaves the EU. It is likely that MPs and peers will want amendments made and that the piece of legislation will have a tough passage through parliament. (FT.com)
  • We saw a mixed bag of economic data releases from the US yesterday in the form of PPI m/m that came in better than expected at 0.1% vs 0.0%, Core PPI m/m that came in weaker than expected at 0.1% vs 0.2% and unemployment claims that came in as expected at 247K.
  • In the US, the Fed’s Kaplan stated he would like to see greater evidence of progress towards 2% inflation and Brainard stated he wants policy to be responsive to changes in economic conditions.
Overnight
  • Last night we saw the business manufacturing index from New Zealand come in at 56.2. It was 58.2 last time around.
  • GBP/NZD is currently trading 1.7699 and GBP/AUD and GBP/JPY are trading at 1.6694 and 146.76, respectively.
Today
  • All eyes on the US today as we look forward to inflation and retail sales data releases at 1.30pm followed by industrial production m/m at 2.15pm.
  • FOMC member Kaplan is due to speak about the Federal Reserve and monetary policy at the Center for Economic Studies of the Private Sector in Mexico City at 2.30pm.
  • It is a bank holiday in France today.
Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1351 +0.03
GBP/USD 1.2953 +0.12
EUR/USD 1.1410 +0.12
AUD/USD 0.7759 +0.40

 

Time (GMT) Region Data Release Forecast Previous
13:30 USD CPI m/m 0.1% -0.1%
13:30 USD Core CPI m/m 0.2% 0.1%
13:30 USD Core Retail Sales m/m 0.2% -0.3%
13:30 USD Retail Sales m/m 0.1% -0.3%
14:15 USD Capacity Utilisation Rate 76.7% 76.6%
14:15 USD Industrial Production m/m 0.3% 0.0%
14:30 USD FOMC Kaplan Speaks